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Bankly Raises $2m to Reach Unbanked Nigerians

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Bankly

By Adedapo Adesanya

In another round of equity funding spreading across the country, a Nigerian fintech startup, Bankly, has raised $2 million in a seed funding round led by investors, including African payments unicorn, Flutterwave.

Other investors include Vault, Plug and Play Ventures, Rising Tide Africa and Chrysalis Capital.

The new funding will allow Bankly to drive its expansion plan in Nigeria by onboarding more agents to its current count of 15,000 on its platform.

The agents are paid commissions on each transaction completed by a customer through them.

The startup wants to leverage its latest funding to increase its 35,000 customers in cash-dependent communities and also launch a variety of direct-to-consumer products in the coming months.

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For the company, this new set of customers opens up access to credit and creates more value which will help the country’s financial inclusion plans as it covers a considerable number of unbanked Nigerians.

With about 50 million Nigerians having no bank account, Bankly digitises cash transactions for the unbanked population, allowing people to save their money using online and offline methods.

The Central Bank of Nigeria (CBN) National Financial Inclusion Strategy aims to increase the number of banked Nigerians from 60 per cent to 80 per cent.

According to the Chief Executive Officer, Ms Tomilola Adejana, in an interview with TechCrunch, stated that, “The first phase is building agent networks which is good, but that’s not the goal. Just in the same way mobile inclusion happened, you need to then focus on acquiring customers who, after transferring cash to their mobile accounts, use it to buy airtime or make payments.

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“We call that the three-phase process. The distribution first, then focusing on the consumer, after that full digitization. This is how we reach financial inclusion.”

She noted that finding the right investors was challenging and based on that the company had to turn down some of the investments offered to the company and only let in investors who aligned with the company’s plans for the unbanked.

“We’ve had to be patient to make sure that we were talking to people who deeply understand the problem and are passionate about solving it and are not about getting returns as soon as possible,” she said.

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Founded by Ms Adejana and Mr Fredrick Adams in 2018, Bankly provides a digital savings and peer to peer transfer platform where users can fund their wallets using tokens available on Bankly vouchers nationwide in a “recharge to save” model.

Functioning in a similar way to traditional banks but with fewer assets, revenue and customers, Bankly lets users collate and save cash with a collector who is responsible for disbursing funds when due.

Adedapo Adesanya is a journalist, polymath, and connoisseur of everything art. When he is not writing, he has his nose buried in one of the many books or articles he has bookmarked or simply listening to good music with a bottle of beer or wine. He supports the greatest club in the world, Manchester United F.C.

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Banking

London Stock Exchange Lists Ecobank $350m Sustainability Bond

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ecobank retail bank

By Aduragbemi Omiyale

The $350 million sustainability bond issued by Ecobank Transnational Incorporated (ETI), the parent company of the Ecobank Group, has been listed on the main market of the London Stock Exchange (LSE).

The green bond was admitted on the LSE on Wednesday at a virtual ceremony to open the market for the trading day and celebrate the successful listing of the tier-2 environment-friendly notes, the first by a financial institution in Sub-Saharan Africa.

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The bond, which matures in June 2031, has a call option in June 2026 and was issued with a coupon of 8.75 per cent with interest payable semi-annually in arrears.

An equivalent amount of the net proceeds from the notes will be used by Ecobank to finance or refinance new or existing eligible assets as described in the bank’s Sustainable Finance Framework.

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The tier-2 issuance is the first to have a Basel III-compliant 10NC5 structure outside of South Africa in 144A/RegS format.

It was gathered that investor interest for this sophomore Eurobond issue was global, including the United Kingdom, the United States, Europe, the Middle East, Asia and Africa, achieving a 3.6x oversubscribed order book of over $1.3 billion at its peak.

The joint lead managers and book runners in the transaction were Citi, Mashreq, Renaissance Capital and Standard Chartered Bank.

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“The strong global interest in our issuance reflects investors’ confidence in Ecobank’s strategy and our commitment to sustainable financing.

“We thank the LSE for hosting ETI today and look forward to value creation for all our stakeholders,” the Group CEO of Ecobank, Mr Ade Ayeyemi, said.

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CBN’s Digital Currency Will Deepen Financial Inclusion—FDC

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Summon CBN Governor

By Adedapo Adesanya

Financial Derivatives Company (FDC) Limited has lauded the proposed plan by the Central Bank of Nigeria (CBN) to introduce a digital currency, saying it will deepen financial inclusion in the country.

In a new report, FDC explained that most central banks had indicated keen interests in developing their digital currencies in response to the threats and limitations of cryptocurrency, including poor regulation, price volatility and facilitating illicit financial transactions.

The report said, “Nigeria is set to follow the global trend as it plans to launch its digital currency by year-end. Unlike crypto, digital currencies are regulated by central banks, thus giving them some level of control over the financial system.

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“On a positive note, virtual currencies would facilitate smooth financial transactions and eliminate bottlenecks associated with the use of cash (mutilated notes, forgery, cash handling charges, shortages). It will also deepen financial inclusion and increase the velocity of circulation.”

The analysis highlighted the rising concerns of distrust in the government and its policies, cybersecurity and inadequate digital infrastructure.

“All these could limit the launch and widespread use of the digital currency in the country,” it said.

According to the report, the drop in inflation rate in May for the second straight month contradicts market reality following the report by the National Bureau of Statistics (NBS) which disclosed that the country’s inflation rate fell to 17.93 per cent in May from 18.12 per cent in April.

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FDC said contrary to analyst expectations, the decline in consumer price inflation seemed to be more of a trend than a blip.

It said the headline inflation fell again in May primarily due to a fall in the food sub-index to 22.28 per cent from 22.72 per cent in April.

This is coming as the CBN last year issued a circular asking commercial banks and other financial institutions to close accounts transacting in, or operating on, cryptocurrency exchanges.

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All deals involving cryptocurrency are now prohibited with severe regulatory sanctions awaiting erring outfits.

The apex bank also asked commercial banks to identify persons and or entities transacting in or operating cryptocurrency exchanges within their systems and ensure that such accounts are closed immediately.

But since the apex bank announced its intention to introduce a digital currency for the country, it has been applauded.

Apart from the FDC, other analysts have submitted that the proposed CBN’s digital currency would benefit the nation, especially as the digital asset is becoming widely accepted across the globe.

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Banking

CIBN to Revamp Banking Practice in Nigeria With A-TEAM Initiative

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CIBN A-TEAM Initiative

By Aduragbemi Omiyale

A strategic initiative aimed to revamp banking practice in Nigeria has been introduced by the Chartered Institute of Bankers of Nigeria (CIBN).

The new plan with the acronym A-TEAM means Accelerated Development; Technology and Digital Enhancement; Engagement for Growth; Accountability and Transparent Leadership and Membership Drive for Value.

As part of efforts for its successful implementation, the CIBN is seeking collaborations with financial institutions in the country.

Recently, the President/Chairman of Council, CIBN, Mr Bayo Olugbemi, visited Ecobank Nigeria and he said the A-TEAM initiative will benefit stakeholders in the banking sector.

He applauded Ecobank’s consistent support for the institute over the years to ensure the realisation of its mandate of determining the standards of knowledge and skills development for those seeking to become members of the banking profession.

“We applaud Ecobank Academy as the first corporate member to become a member of the Global Business School Network and for the consistent support for the realisation of the institute’s mandate of determining the standards of knowledge and skills to be attained by persons seeking to become members of the banking profession.

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“We, therefore, seek Ecobank’s collaboration and enlistment in our Endowment/Prize Awards in any subject of interest; support towards the renovation of Abuja Bankers’ House; support for the establishment of banking museum by donating artefacts and other relevant materials; and to participate actively in training programmes of the institute,” Mr Olugbemi said.

Further, he congratulated Ecobank Nigeria and the Ecobank Group on winning several International awards, which includes the Best Retail Bank in Nigeria by Asian Banker; Africa’s Best Bank for Corporate Responsibility by Euromoney (Ecobank Group); African Bank of the Year (African Banker); Innovation in Financial Services Award from African Banker (Ecobank Group); EMEA Finance African Banking Awards 2020.

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Responding, the Managing Director of Ecobank Nigeria, Mr Patrick Akinwuntan, pledged more support and collaboration with the institute, restating that Ecobank will continue to contribute to the efforts of the organisation to become top class and remain relevant globally.

“For us at Ecobank, we are extremely proud CIBNs efforts at ensuring public discourse on the future of the Nigeria economy and the banking and finance industry.

“This is not in isolation of the ethics, professionalism, accountability, transparency, good corporate governance without losing focus of harnessing the opportunities technology has provided in the new world order. Be assured of our maximum support and collaboration at all times,” he said.

Mr Akinwuntan also identified with the efforts of the institute to raise the bar of competency and capacity building in the industry, stressing that with sound professional conduct, every banker will be held in high esteem.

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He said Ecobank was working assiduously to ensure a majority of its staff become members of the institute, adding that the bank will also provide more mentees and mentors in its mentorship programme.

“We have a medium to long term programme to ensure all Ecobank Nigeria staff become chartered members of the institute.

“At Ecobank, we take human capacity development very seriously. Some of our staff that wrote the last examinations are now chartered members of the Institute.

“We will also ensure bulk subscription of our staff. We will be nominating 30 mentors and 100 mentees to participate in the second mentorship programme,” he assured.

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